Candlestick Analysis Today’s Candlestick Patterns: Black Opening Marubozu Bearish Belt Hold Bearish Engulfing

Today a Black Opening Marubozu was formed. This shows that the day opened and prices continuously went down but they did not close at the low of the day and thus they created a lower shadow. For more about this candlestick click here. Bearish Belt Hold Pattern. This is a bearish reversal pattern that marks a potential change in trend. However, its reliability is low and it definitely requires confirmation. For more about this pattern click here. The last two candlesticks formed a Bearish Engulfing Pattern . This is a bearish reversal pattern that marks a potential change in trend. However, its reliability is not very high and it requires confirmation. (http://www.americanbulls.com/StockPage.asp?CompanyTicker=MRVL&MarketTicker=NASD&TYP=S) There are three possible cases of bearish confirmation. You have to follow the session closely to see if these cases will hold or not. The market opens with a downward gap, signaling a bearish sentiment in the first case. Your benchmark will be the opening price. If the prices stay below the benchmark, sell your shares. Any black candlestick with a downward gap is a valid bearish confirmation criterion. In the second case, the market opens at a level, equal to or above the previous day’s close. The benchmark is that closing price. If prices during the session stay below the benchmark, sell your shares. Any black candlestick closing below the previous day’s close is the second confirmation criterion. If, however, in both cases, the prices during the session start going over the benchmark avoid selling. The third case of confirmation is rarely observed. The market opens with a big upward gap suggesting a very bullish day, and the day ends with a black candlestick, but still closing above the previous day’s close. Such a day satisfies the third confirmation criterion and the closing price of the black candlestick is the benchmark. If one of the three confirmation criteria is not fulfilled, or in case of a white candlestick or a doji on the confirmation day, the SELL-IF alert remains valid, however, without confirmation and the three confirmation criteria are then sought in the following day. The only exception is the long white candlestick. Any white candlestick following a SELL-IF alert makes the signal void and invalid. The market looks strong on the short side as evidenced by recent price activity. If the SELL-IF is confirmed, new short selling may be considered